Spartan Delta Corp · TSX:SDE
Spartan Delta — Investor Presentation (March 2023)
32 slides from Spartan Delta's investor presentation, Mar 2, 2023
Slide 1: Investor Presentation
INVESTOR PRESENTATION Spartan Delta Corp. (SDE: TSX) March 2, 2023
Slide 2: Spartan Delta Corporate Strategy
SPARTAN DELTA CORPORATE STRATEGY Building a Sustainable Energy Company CONCENTRATED ASSET BASE DEEP BASIN MONTNEY Sustaining capital ~30% of asset level NOI Largest producer and acreage holder in the oil window of the Montney Low OPEX and high margin liquids-rich gas led by operated deep cut i
Slide 3: Strategic Milestones
STRATEGIC MILESTONES Continuing to Build Shareholder Value Through Execution of the Business Plan Execution of Acquisition and Integration Strategy Key Corporate Highlights Since Recapitalization(1) 1 Growth Through Targeted Acquisitions in a Depressed Market Debt Adjusted Production Per Share Growt
Slide 4: Company Overview
COMPANY OVERVIEW Spartan Delta Corp. (SDE:TSX) Capitalization (as at March 1, 2023) Spartan Delta Corp. TSX SDE MONTNEY: (1) Spartan is the largest Share Price $/sh 12.57 producer and land holder in (1) the Montney oil window Market Capitalization (basic) $MM 2,155 Deep inventory of (2) developm
Slide 5: Fourth Quarter and Year-End 2022 Highlights
FOURTH QUARTER AND YEAR-END 2022 HIGHLIGHTS Focused Operational Execution Delivered Record Results in 2022 UNAUDITED HIGHLIGHTS FY 2021 FY 2022 Q4 2022 Average production volumes were 74,639 boe/d (22% oil and condensate, 17% NGLs Crude Oil boe/d 4,697 12,976 13,714 and 61% natural gas) in the fourt
Slide 6: 2023 Guidance
2023 GUIDANCE Poised to Deliver 11% Production Growth Year-over-Year and a 21% Free Funds Flow Yield (1) 2023 Guidance Guidance Average Production boe/d 80,000 - 82,000 Crude Oil and Condensate boe/d 18,100 Natural Gas Liquids boe/d 13,800 Natural Gas mcf/d 294,600 Operating Expenses $/boe (8.41) Tr
Slide 7: Year-End 2022 Reserve Evaluation
YEAR-END 2022 RESERVE EVALUATION Based on 2022 Average Forecast Pricing of U$72.83/bbl WTI and C$3.56/MMBtu AECO Independent qualified reserves evaluation effective December 31, 2022 (2) 2022 RESERVE HIGHLIGHTS Volume - Gross (MMboe) Value - NPV10 ($MM) PDP TP TPP PDP TP TPP 2021 124.309 293.749 5
Slide 8: 2023 Development
2023 DEVELOPMENT Maintaining Strong Free Funds Flow While Advancing Selected Growth Projects BC AB MONTNEY ~40,000 boe/d 2023E(1) ~$310 MM 2023 Capital ~27 net wells 450,000 net acres >1,100 net drilling locations identified (266 booked)(2)(4) Self-funding growth core area $430 MM(5) Develop
Slide 9: The Montney Oil Fairway
THE MONTNEY OIL FAIRWAY A Differentiated Montney Play Targeting >50% Oil Weighted Production Montney Thermal Maturity >450,000 acres (>700 sections) of prospective Montney with in-place Flatrock volumes of up to 45 mmboe/section Over 1,100 net identified drilling locations with 266 net locations
Slide 10: Montney Overview
MONTNEY OVERVIEW Deep Inventory of Growth Projects in the Montney Oil Window Montney Asset Characteristics: BC AB Largest land position (>450,000 net acres) and production base within the prolific Montney oil window Flatrock Deep inventory of economic drilling locations (>1,100 net) across sever
Slide 11: Gold Creek East Asset Overview
GOLD CREEK EAST ASSET OVERVIEW Repeatable Results with Available Infrastructure Capacity Asset Characteristics: Development asset with exceptional Production(1): 18,320 boe/d (53% liquids) economics contributing significant free (Q4 2022) funds flow Inventory 153 Booked (230m spacing) Recently c
Slide 12: Gold Creek West Asset Overview
GOLD CREEK WEST ASSET OVERVIEW Development Asset with Step-Out Growth Opportunities Asset Characteristics: Development asset with strong economics Production(1): 6,348 boe/d (55% liquids) (Q4 2022) Spartan owned battery and gathering Grande Prairie system to 8,000 boe/d capacity Inventory 69 Boo
Slide 13: Karr Asset Overview
KARR ASSET OVERVIEW Top Oil Wells in the Montney Asset Characteristics: Production(1): 3,878 boe/d (77% liquids) Amongst the most prolific oil (Q4 2022) wells in the basin Inventory 38 Booked (350m spacing) (net): 44 Unbooked (350m spacing) Low decline Montney oil wells 82 Total (3,000-3,500m HZ
Slide 14: Deep Basin Overview
DEEP BASIN OVERVIEW Robust Economics and Infrastructure Footprint Underpin Free Funds Flow Engine Deep Basin Asset Characteristics: CENOVUS SAND CREEK SDE O’CHIESE NEES-OHPAWAGANU’CK 10-09 • 75 MMcf/d (9.6% WI) • 230 MMcf/d Deep Cut (25% WI) Top quality resource of delineated liquids-rich Spirit R
Slide 15: Risk Management
RISK MANAGEMENT Natural Gas Hedging Preserves Return of Capital Optionality in Volatile Gas Markets ~38% ~23% 0% Of natural gas hedged in 2023 Of production hedged in 2023 Of crude oil hedged ~45% Of summer gas hedged Natural Gas US$ NYMEX - AECO 7A Basis US$ NYMEX Swaps - Short US$ NYMEX Swaps - Co
Slide 16: Return of Capital
RETURN OF CAPITAL Inaugural Special Dividend and Outlook for 2023 Special Dividend 2023 Discretionary Free Funds Flow – Oil Price Sensitivity(2) On November 8th, 2022 Spartan declared a special dividend of $0.50 per common share(1) The special dividend was a product of the Company's exceptional
Slide 17: Spartan's Sustainable Development Goals
SPARTAN’S SUSTAINABLE DEVELOPMENT GOALS Spartan is Committed to Meeting the Needs of the Present, While Protecting the Future Results: Active Initiatives: Water Recycling 44% reduction Award winning produced water recycling program at in Direct and Indirect GHG Gold Creek, resulting in Emissions Int
Slide 18: Investor Highlights
INVESTOR HIGHLIGHTS Concentrated Core Development Areas with Torque to both Oil and Natural Gas Tailwinds Dominant position in two core areas, the Montney and Deep Basin, yielding some of Canada’s most prolific economics Financial sustainability with prudent leverage and strong Adjusted Funds Flow a
Slide 19: Appendix
2) SPARTAN March 2, 2023 APPENDIX
Slide 20: 2023 Budget Type Curve Economics
2023 BUDGET TYPE CURVE ECONOMICS Asset Gold Creek East Gold Creek West Karr Type Curve(1) Units North East Karr IP 90 BOE (Wellhead) BOE/d 1,161 1,099 673 EUR Oil (Sales) mbbl 427 370 621 EUR Gas (Sales) Bcf 3.0 2.2 1.4 EUR BOE (Sales) mBOE 1,080 813 944 % Liquids % 54% 55% 74% Average Royalty % 17%
Slide 21: Montney Targets and Reservoir Parameters
MONTNEY TARGETS AND RESERVOIR PARAMETERS Extensive Inventory Developed Primarily With a Single Layer to Maximize Returns A A’ Doig Flatrock Pouce Coupe Gold Creek West Gold Creek East Karr Simonette Upper Montney Upper Middle Montney Lower Middle Montney/D1 Lower Montney Porosity >3% Primary Target
Slide 22: Analyst Coverage & Contact Information
ANALYST COVERAGE & CONTACT INFORMATION Institution Analyst EXECUTIVE OFFICE STOCK EXCHANGE LISTING ATB Capital Markets Patrick O’Rourke Spartan Delta Corp. The TSX Exchange 1500, 308 – 4th Avenue SW Trading Symbol: SDE Calgary, Alberta T2P 0H7 BMO Capital Markets Mike Murphy INVESTOR INFORMATION P:
Slide 23: Area Montney Map
AREA MONTNEY MAP Spartan’s Positioning in the Montney Fairway March 2, 2023 23
Slide 24: Management Team & Board of Directors
MANAGEMENT TEAM & BOARD OF DIRECTORS MANAGEMENT TEAM Richard McHardy Former President, CEO and co-founder of Spartan Energy, Spartan Oil and Spartan Exploration Executive Chairman & Director Fotis Kalantzis Former SVP and co-founder of Spartan Energy, Spartan Oil and Spartan Exploration Presiden
Slide 25: Disclaimer
DISCLAIMER Forward Looking Statements commodity prices and the actual timing of our capital expenditures. Actual results may vary Certain information included in this presentation constitutes forward-looking information under materially from forecasts due to changes in interest rates, oil differen
Slide 26: Disclaimer Cont'd
DISCLAIMER CONT’D Oil and Gas Advisories well. Management considers payout an important measure to evaluate its operational BOE Disclosure. The term barrels of oil equivalent ("boe") may be misleading, particularly if performance and capital allocation processes. It demonstrates the return of cash
Slide 27: Disclaimer Cont'd
DISCLAIMER CONT’D Oil and Gas Advisories Drilling Locations / Inventory. This presentation discloses drilling inventory in three categories: (i) proved locations; (ii) probable locations; and (iii) unbooked locations. Proved locations and probable locations are derived from the McDaniel Report and
Slide 28: Disclaimer Cont'd
DISCLAIMER CONT’D Non-GAAP Measures and Ratios expenditures, excluding acquisitions divided by the Company’s Market Capitalization using the This presentation contains certain financial measures and ratios, as described below, which do treasury stock fully diluted shares outstanding. not have stan
Slide 29: Price Deck Details
PRICE DECK DETAILS Guidance Pricing All guidance, forecasts and economics are based on the following budget price deck (unless otherwise stated): 2023E WTI US$/bbl $80.00 Edmonton Oil C$/bbl $102.41 Edmonton Cond. C$/bbl $102.81 AECO 7A C$/GJ $4.50 AECO 7A C$/mmbtu $4.75 NYMEX US$/mmbtu $5.31 Conway
Slide 30: Auditor Price Deck Details
AUDITOR PRICE DECK DETAILS Three Consultant Average (McDaniel, GLJ and Sproule) January 1, 2023 3 Consultant Average (McDaniel, GLJ and Sproule) Summary of Price Forecasts Sunday, January 1, 2023 C rude O il P ric e F o re c a s t s Liquids P ric e F o re c a s t s G a s P ric e F o re c a s t s E d
Slide 31: Abbreviations
ABBREVIATIONS A&D Acquisitions and Dispositions AECO Alberta Energy Company "C" Meter Station of the NOVA Pipeline System API American Petroleum Institute gravity ARO Asset Retirement Obligations bbl; bbl/d Barrel; barrels per day bcf; bcf/d Billion cubic feet of natural gas; billion cubic feet per
Slide 32: Info@SpartanDeltaCorp.com www.SpartanDeltaCorp.com
Info@SpartanDeltaCorp.com www.SpartanDeltaCorp.com